The Financial Services Authority committed itself yesterday to regulating with a lighter hand, sticking to a risk-based approach rather than insisting on rigid requirements with "17 boxes to tick".
New guidelines for money laundering are expected in a report next month from a group including representatives from the Bank of England, the National Criminal Investigation Service as well as the British Bankers' Association, credit card issuers and the Financial Services Authority itself.
Meantime, the FSA's business plan for 20006/07 published yesterday highlights its commitment to improving the assessment of the risk involved in specific sectors or aspects of the markets it regulates.
"While much of our policy work continues to be driven by initiatives at an EU and international level, we have wide discretion over much of what we do day-to-day," said John Tiner, the FSA's chief executive.
The business plan under-takes to implement "to a high standard" two controversial European directives - on markets and financial instruments and capital requirements.
Asked if this meant "gold plating" a FSA spokesman said "quite the opposite".
"We want to do it sensibly in a cost-effective way, a perfectly cooked steak, not a chargrilled one," he said.
"We are going to do some objective cost-benefit analysis for the UK."
Overall, the FSA is budgeting to pay its staff 4.5 per cent more this year.
Many individuals will get less, but the FSA wants headroom to pay retention bonuses to a "gilded few", who might otherwise be lured away to the City.
Its total budget for 2006/07 is rising by 3.25 per cent to £276.1 million.
To keep within this total, the regulator said it will need to improve productivity by £7 million.
The money all comes from fees levied on 29,000 regulated firms.
The FSA said 82 per cent of them should see a fall, no change, or an increase of less than three per cent in their annual fee. Minimum fees for small firms should go up by no more than 2.5 per cent, it added, and many of them will see no increase at all.
The fees calculator on the FSA's web site will be updated once the precise rates have been finalised in May.